From Stoke’s ceramics industry to Midlands carmakers and well-known high street chains, businesses face an uncertain future.

Unemployment is rising as shops close and factories cut back on production. In the circumstances, does it make sense for firms to recruit new staff?

Birmingham Chamber of Commerce has reacted to Government plans to offer businesses “golden hello” payments by warning that it makes no sense to increase staff numbers.

But staff come and go even in the middle of a recession.

Businesses may choose to leave some vacancies unfilled, but firms will inevitably have to recruit new employees on occasion.

When this happens, they have nothing to lose by taking advantage of the offer of a subsidy.

However, £500 million to encourage businesses to take on the long-term unemployed, welcome as it may be, will do nothing to solve the real problem facing many industries today.

As the Chamber points out, what employers really need is the resumption of lending by the banks.

Across the economy, access to credit is an integral part of the way businesses operate.

Many firms struggle to get by without it, in some cases because suppliers do not have the confidence to continue trading with them.

Jaguar Land Rover is the most high profile example of a business which is affected by the unavailability of credit

But while there are specific reasons for helping the Midland carmaker, it is a problem which affects industry as a whole.

Nobody knows how long the recession is going to last. Britain is going to have to cope with rising unemployment for many months to come.

Grants for employers or measures which encourage consumer spending, such as tax cuts, may alleviate the effects of the slowdown to some extent.

But they are less than sticking plasters in comparison to the solution the nation really needs, which is to get money moving again.

This does not mean returning to an era when families were encouraged to stack up debts they could never afford to repay.

In particular, we need a return to the days when a home was seen as somewhere to live more than an investment.

Soaring house prices lead to soaring mortgages, and cause hardship for as many people as they benefit.

But credit in the business world is a different matter.

Firms need to borrow, and making this possible should be the first priority for the Government.